A federal bankruptcy judge on Thursday blocked an attempt by families of victims of the Sandy Hook shooting to immediately recover assets from conspiracy theorist Alex Jones’ media company, which is set to be sold.
Judge Christopher Lopez of the Southern District of Texas sided with Christopher Murray, the court-appointed trustee overseeing the liquidation of Jones’ estate. In an “emergency” motion filed Sunday, Murray accused certain family members of plotting a “value-destructive profit-making scheme” despite the fact that the company has yet to complete an “orderly winding-down” and sale of Free Speech Systems.
Lopez agreed that Murray must continue to evaluate and liquidate Jones’ assets, but told him “he cannot hand over the bank accounts.”
In his filing, Murray asked Lopez to halt for 90 days the ability of family members and other creditors to collect through the sale of assets, including the liquidation of Free Speech Systems’ inventory.
“FSS’ assets, including its cash, are at risk of being seized in a series of seizures, which could disrupt and possibly halt its operations and impair the interests of the Chapter 7 estate for which the trustee is responsible,” he wrote.
Lopez issued an order Thursday making it clear that no money has to be handed over and said he will review the trustee’s progress next month.
“I don’t think it’s an emergency anymore,” Lopez said in making his decision.
The latest legal battle exposes a rift between families of Sandy Hook Elementary School students who filed a defamation lawsuit in Texas, where Jones lives, and Connecticut, the state where the 2012 massacre took place, in which a gunman killed 20 first-graders and six adults.
The Texas lawsuit was filed by the mother and father of one of the murdered children, while the Connecticut lawsuit was filed on behalf of family members of eight of the victims.
In 2022, plaintiffs in the two lawsuits were awarded a combined total of roughly $1.5 billion for defamation and emotional distress, alleging that Jones repeatedly suggested the shooting was faked on his Infowars platform, run by Free Speech Systems.
However, Jones filed for bankruptcy after the judgment, saying he could not afford to pay the large sums, and none of the family members have been able to recover any money from him.
On June 14, Judge Lopez ruled that Jones’ bankruptcy filing could be converted into a liquidation of his personal assets to pay the defamation judgment, but he also dismissed a separate bankruptcy filing by Free Speech Systems, ruling that “creditors would be better served to pursue their rights in state court rather than federal bankruptcy court.”
The decision to dismiss the Free Speech Systems bankruptcy case was supported by Jones, who continues to broadcast Infowars, but who has suggested in recent weeks that he may be forced to end the show in its current form if his company is sold.
Following Lopez’s ruling, Sandy Hook Elementary School parents in a Texas lawsuit asked a state district judge to compel Free Speech Systems to turn over “all funds” of the media company, including “funds held in bank accounts or managed by third parties at the direction of the media company.”
The move is opposed by Murray and the Connecticut plaintiffs, who worry that all of Jones’ family members will have to fight over his assets.
“To be clear, the Connecticut Family supports the orderly liquidation of FSS’ assets and pro rata distribution to FSS’s creditors with valid claims,” they wrote in a filing this week supporting the receiver’s emergency request. “The Texas Family clearly does not have the same goal. Rather, they are seeking preferential treatment and a significant recovery by attempting to win the race to court that they claim to have avoided on June 14th.”
Lawyers for the Texas plaintiffs urged Lopez not to grant the trustee’s request for an injunction because a judge has already ruled that Free Speech Systems should come under state jurisdiction.
But Lopez said Thursday that a Texas judge’s order granting the Texas plaintiffs’ request was “inconsistent” with the judge’s decision this month to give the trustee control.
Mark Bankston, a Texas plaintiffs’ attorney, said his clients “are ultimately frustrated that they won’t be able to pursue their rights in state court” and believe “to Mr. Jones’s delight, this case will remain in limbo.”
He said his clients would like to work with the other plaintiffs to recover the same amount of damages Jones owes them, but “we have been continually rejected,” adding that other plans to force Jones to pay damages but “never speak about Sandy Hook again” have been rejected by the other plaintiffs.
Christopher Mattei, a lawyer for the families of those killed in the Sandy Hook attacks in Connecticut, said he was pleased the judge had not allowed the Texas plaintiffs’ case to proceed.
“Connecticut families have always sought a fair and equitable distribution of Free Speech Systems’ assets to all families, and today’s ruling puts us back on that path,” Mattei said in a statement.
During Thursday’s hearing, Lopez declined to weigh in on the family rift.
“The last thing I want is to start a new conflict between two families who have already had enough,” he said. “Just follow the rules, follow the norms, follow the orders.”
Jones has personal assets of about $9 million, while Free Speech Systems has about $6 million in cash and more than $1 million in inventory, according to court documents.
Jones warned on his show this week that Thursday’s hearing could bring Infowars closer to being shut down.
“I know it’s exhausting. This rollercoaster fight with the establishment trying to shut down Infowars is exhausting for me,” he said, adding that he wanted to stay on the air so he could make the profits his creditors would hope would allow him to repay them.
But “they don’t want money,” he told the audience. “They want to shut me up.”
